Question 2 [60 points]

Southgate Inc. completed all of its June 30, 2015, adjustments in preparation for preparing its financial statements, which resulted in the following adjusted trial balance.

Question 2 [60 points] Credit Southgate Inc. completed all of its June 30, 2015, adjustments in preparation for preparing its financial statements, which resulted in the following adjusted trial balance. Adjusted Trial Balance a) Prepare the entry (entries) to record any impairment losses at June 30, 2015. Assume the company recorded no Accounts payable $4,800 impairment losses in previous years. Enter an appropriate description when entering the transactions in the journal. Dates must be entered in the format dd/mmm (ie. January 15 would be 15/Jan). For each journal entry, indicate how Accounts receivable 9,300 each account affects the balance sheet (Assets, Liabilities, Equity). Use + for increase and - for decrease. For Accumulated depreciation, building. 33,000 example, if an account decreases equity, choose '-Equity' Accumulated depreciation, equipment. 16,800 General Journal Page Gj1 Effect On Accumulated depreciation, furniture 9,400 Date Account/Explanation F Debit Balance Sheet Allowance for doubtful accounts 430 Building 63,000 + Cash 5,020 Equipment 44,000 Expenses, including cost of goods sold 349,000 Furniture 20,000 b) Prepare a classified balance sheet at June 30, 2015. Share capital 28,400 (select one) Land 47,000 Balance Sheet Merchandise inventory 15,900 (select one) Long-term notes payable 39,000 Retained earnings 41,000 Sales 376,800 Unearned revenue 3,590 1) All accounts have normal balances. 2) $12,200 of the note payable balance is due by June 30, 2016. The final task in the year-end process was to assess the assets for impairment, which resulted in the following schedule. Asset Recoverable Value Land $50, 100 Building 33,100 Equipment 25,200 Furniture 11,700 Question 2 [60 points] Credit Southgate Inc. completed all of its June 30, 2015, adjustments in preparation for preparing its financial statements, which resulted in the following adjusted trial balance. Adjusted Trial Balance a) Prepare the entry (entries) to record any impairment losses at June 30, 2015. Assume the company recorded no Accounts payable $4,800 impairment losses in previous years. Enter an appropriate description when entering the transactions in the journal. Dates must be entered in the format dd/mmm (ie. January 15 would be 15/Jan). For each journal entry, indicate how Accounts receivable 9,300 each account affects the balance sheet (Assets, Liabilities, Equity). Use + for increase and - for decrease. For Accumulated depreciation, building. 33,000 example, if an account decreases equity, choose '-Equity' Accumulated depreciation, equipment. 16,800 General Journal Page Gj1 Effect On Accumulated depreciation, furniture 9,400 Date Account/Explanation F Debit Balance Sheet Allowance for doubtful accounts 430 Building 63,000 + Cash 5,020 Equipment 44,000 Expenses, including cost of goods sold 349,000 Furniture 20,000 b) Prepare a classified balance sheet at June 30, 2015. Share capital 28,400 (select one) Land 47,000 Balance Sheet Merchandise inventory 15,900 (select one) Long-term notes payable 39,000 Retained earnings 41,000 Sales 376,800 Unearned revenue 3,590 1) All accounts have normal balances. 2) $12,200 of the note payable balance is due by June 30, 2016. The final task in the year-end process was to assess the assets for impairment, which resulted in the following schedule. Asset Recoverable Value Land $50, 100 Building 33,100 Equipment 25,200 Furniture 11,700